Next Orbit's USD 750mn fund gets commitment from UAE investors

Venture capital firm Next Orbit Ventures (NOV) has received commitment from UAE-based investors, including DP World, Emmar and Etisalat, for its over USD 750 million or Rs 5,000 crore fund.

Image: Shutterstock

The company plans to invest the proceeds of the over Rs 5,000 crore (USD 750 million) fund in digital, analog and solar fabrication (fabs) projects along with semiconductor design, electronics, led and solar products to feed those fabs, a statement said today. Company's founder and Managing Partner Ajay Jalan said,

The investors from UAE International Investors' Council which includes 18 UAE entities like Mubadala, DP World, Etisalat, Emmar, among others have shown keen interest in investing in this fund and the project

Nearly 49 per cent of the commitment towards the fund is expected from the Centre, as NOV has been selected as the 'Daughter Fund' under its electronics development scheme and for investing in the project that intends to reduce the country's electronics imports which can reach USD 300 billion from current USD 90 billion in 2020, it said.

This investment spree in India follows the 'digital India' and 'make in India' programs of the government, which are providing economic, skill development and tax incentives to electronics manufacturing. The project will provide more than 28 million jobs in the country and also will be second source of quality supply of electronic, LED and solar products which is currently dominated by cheap Chinese products, he said.

Dubai-based IBMC Financial Professionals Group is the advisor to this second ESDM fund for Gulf Cooperation Council (GCC). NOV has already committed to seed invest USD 100 million (Rs 700 crore) equity investment in the first phase equity of USD 5.6 billion digital fabs in technical collaboration with AMD of the US and ST Microelectronic of France. The project will come up at Prantiz near Ahmedabad, Gujarat. The Centre has identified 1,200 acres of land in Prantiz and has already started developing the necessary infrastructure to make it a manufacturing hub, the release said.

We are coming as first investors into this fab project to back India's growing electronics market, which will reach USD 400 billion by 2020 and requires USD 100 billion of investment for achieving 'zero import' target, Jalan said.

Mumbai-based venture capital firm, Next Orbit Ventures wasfounded by Ajay Jalan in 2014 from its first $ 100 Mn (Rs. 700 crores) Fund. The company has been making investments in MSME companies in Consumer products & Services and Internet & Technology support services that will create the demand for the chips in India. Last year the company had launched their second fund of USD 750 million (Rs. 5000 crores), which will be invested in the ESDM sector, including Electronic Components (Semiconductor & Active), Electronic Products (IOT/ Solar / LED / Health Care), Semiconductor Design Services and Electronic Manufacturing Services.